Does banking make bankers behave badly?

29 Jan

Research that suggests this is more than a hypothetical question comes from a variety of sources. One of the most powerful is the set of studies by Kathleen Vohs, associate professor of marketing at the Carlson School of Management of the University of Minnesota. These studies show that just thinking about money causes people to be less generous and to make poorer, more selfish and (by inference) less ethical decisions.

Banking is also, in the modern context, a high-pressure, busy, occupation. People are constantly subjected to the stress of trying to achieve more in too little time. According to Dr Roy Baumeister at Florida State University, they therefore are strongly prone to “ego-depletion” — exhaustion of the executive functions within the brain that allow us to exert self-control. People under day in, day out pressure are likely to make more selfish, superficial choices and decisions.

Banking isn’t the only occupation, where the environment may promote unethical thinking and behaviour. In the cash-strapped National Health Service, constant reminders about the need to save money, combined with long and stressful working hours, it’s not surprising to see the same phenomenon at work. Similar environments include social care and corporations that define a performance culture in terms that over-emphasise financial performance at the expense of wider contributions to societal well-being.

This combination of a high-pressure environment and constant prompts (both conscious and unconscious) that nudge people towards poor ethical choices is difficult to combat. Neither education nor codes of practice are likely to have much impact. So what can concerned individuals and their organisations do in the way of countermeasures? The two golden rules appear to be:

  • Change what you are mindful of
  • Recognise and manage the effects of overwork and stress, to retain a sense of humanity

Change what you are mindful of

One of the most practical and simple steps you can take is to introduce counterbalancing conscious and subconscious triggers that remind you of human connection. For example:

  • Instead of charts and data, pepper the working environment with pictures of customers and beneficiaries from your work
  • Make your telephone ring tone one that triggers positive human emotions (e.g. baby laughter)
  • Find opportunities to be kind to others each day. (But beware of the trap of thinking that each kindness gives you permission to do something less generous in balance.)
  • Give some genuine thank yous each day. Not the perfunctory thanks we routinely give to a shop assistant, but thanks with eye contact, an authentic smile and a fleeting exchange of warmth.
  • Be kind to yourself each day. Small acts of earned self-reward or self-forgiveness can have a relatively big effect on how you respond to what’s going on around you
  • Have a “Mrs Wilson” to refer to when making choices. A now retired banker told me about Mrs Wilson – an elderly widow, who struggled with the complexities of dealing with her accounts, and who has opinions on everything. He would frequently have an imaginary conversation with her about decisions he had to make. While he didn’t always follow her advice, he was able to ground his decision in how it would impact and be seen by people in the outside world.
  • Measure your day’s work by things other than money or things that are money-related. Score yourself at the end of each day on “What did I do today to make the world a better place?” (If you have zero balance in this account, you and your organisation have a problem!

Recognise and manage ego-depletion

Once again, simple disciplines can make a big difference. For example:

  • Take time to recharge your mental batteries before addressing difficult decisions or decisions with potential ethical dimensions. Going for a walk or meditating briefly can help, as does eating a small something that will raise blood sugar levels.
  • Recognise the signs of stress and develop better defences. For example, learn to pause and spend a few moments bringing to mind a recent time of joy. (If you can’t find one within the past three months, seek help!)
  • Remember that the answer to ego-depletion isn’t to try and get things done faster. It is to slow down briefly to give your reserves of mental energy time to replenish, after which the greater effectiveness and efficiency of your thinking will save time.
  • Recognise that stress reduces our resistance to the human tendency to dehumanise groups other than our own. The groupthink that flourishes with long-term stress makes us even less open to dissenting opinions. A practical antidote is to cultivate frequent and open dialogue with outsiders, valuing their perspectives as helpful in finding innovative solutions to stress-creating problems. (And thereby extending in-group status to them.)

These examples are all simple adaptations to the way we work and the environment around us, which cumulatively and adopted by many people, have the power to change an organisation’s culture. If leaders have the courage and self-awareness to role model such behaviours, maybe the answer to the question Does banking make bankers behave badly? can be “Not necessarily” or even “Not here!”

© David Clutterbuck, 2014

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